In this paper a Real Time Digital Image Stabilizer system developed for correction of image translation and rotation in sequence of frames is presented. The image stabilization consist on the process of removing inevitable and undesirable fluctuation, shakes and jiggles. In order to reduce the computational costs, the proposed digital image stabilization (DIS) system performs motion estimation using the Block Matching (BM) technique with three steps search (3SS). A Moving Average filter for motion smoothing and an algorithm able to identify large intentional camera movements and object movements were used to improve the performance of the BM estimation. Tests of the system using video sequences and data from a Web-Cam demonstrated the good performance of the image stabilization system developed.